As many as 10,500 UK financial services jobs, including many front office roles, could be relocated to the continent in time for Day One of Brexit, according to a major consultancy’s ‘Brexit tracker’ – though the figure may come as a welcome adjustment.
Since the Referendum vote, 31% of the largest financial services companies in the UK have said they are considering or have confirmed they will move some of their operations or staff out of the UK as a consequence of Brexit – equating to 68 out of 222 companies.
Forty two (42) of those companies have confirmed at least one relocation destination in Europe, with Dublin and Frankfurt as the frontrunners, attracting 14 and 12 companies respectively, EY’s latest Financial Services Brexit Tracker has revealed.
Last year, an estimate from 12 financial services firms suggested that 12,500 jobs would move out of the UK as a consequence of any type of Brexit, but a year on, the total has dropped to 10,500 jobs.
For the most part, detail as to which types of roles will be relocated is yet to be provided, but the tracker data confirms they are not primarily back office or support functions. In fact, of the 18 companies that have specified the types of work that might move to Europe, 14 are client facing ‘front office’ roles.
“Contingency plans have developed significantly over the last year, putting firms in a stronger position to estimate how many UK jobs they need to move,” Omar Ali, EY’s UK financial services leader, said in a statement.
“Firms are working hard to find viable solutions that will allow them to continue to serve their customers and satisfy regulators with the minimum disruption. As a result, many of the jobs that are moving are client facing, ‘front office’ roles to ensure that companies can continue to serve their clients under EU law from Day One,” he went on to say.
While the extent of broader strategic restructurings and relocation plans will ultimately depend on the specifics of any UK-EU deal, a drop in the volume of jobs moving will be welcome news for the City, commented Ali.
“While the relocation of this number of roles will have a significant impact on the smaller financial services centres on the continent, it is unlikely in the short term to threaten London’s role as Europe’s main financial hub,” he said.
Ali continued: “The increase in the number of firms publicly setting out their contingency plans highlights the level of planning the sector has done. The announcement… from the negotiators on both sides sent a wave of relief across the City, as it signalled an intention to agree a transitional period as early as possible next year and the starting point for negotiations on future trade deals. Both of which are fundamental to avoid adding any additional risks to the system and for the future strength of the UK financial services industry.”
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